Abstract
This study estimates the return to education in Britain using two instrumental variable (IV) estimators: one exploits variation in schooling associated with early smoking, the other uses the raising of the school leaving age; both affect a sizeable proportion of the sample. Early smoking is found to be a strong and valid IV and unlike previous IV strategies uses variations in education at numerous points across the distributions of (i) education, and (ii) ability. Thus whilst still a ‘local average treatment effect’ the estimate is closer to the average effect of additional education, akin to least squares but corrected for endogeneity.
Original language | English |
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Pages (from-to) | 477-498 |
Number of pages | 22 |
Journal | Oxford Bulletin of Economics and Statistics |
Volume | 75 |
Issue number | 4 |
Early online date | 21 Jun 2012 |
DOIs | |
Publication status | Published - Aug 2013 |
Keywords
- poverty
- work
- justice